MERS records another win
MERSCORP Holdings, Inc. (MERS) racked up another win, with a judge in the Circuit Court of Lonoke County, Arkansas Civil Division ruling that MERS had no duty to record assignments in the state of Arkansas, dismissing the class action case without prejudice.
Circuit Court Judge Sandy Huckabee ruled that “Based on current Arkansas law, consistent with the decisions of the Arkansas Supreme Court, there is no duty to record assignments in the State of Arkansas.”
Judge Huckabee added, “Therefore, the Court finds that each claim in the Amended Class Action Complaint fails to plead a basis upon which relief can be granted.”
Other cases in MERS’ favor
A similar suit filed by the Circuit Clerk of Hot Spring County, Arkansas was dismissed as “Arkansas’s statutes ‘do not require assignments to be recorded.’”
“We have consistently held that the MERS business model complies with the requirements of the recording statutes,” said MERSCORP Holdings Vice President for Corporate Communications, Janis Smith.
This decision joins the dismissals of similar lawsuits brought by county recorders in Florida, Illinois, Iowa, Kentucky, Michigan, Minnesota, Missouri, North Carolina, Oklahoma, and Rhoda Island.
15 years of filing fees across the nation
MERS was initially established by Fannie Mae and Freddie Mac over 15 years ago in conjunction with several major banks as a means to expedite the loan recording process as it used to be done through individual county clerk offices which was slow. “The founders went ahead even though no state laws authorized them to bypass the required filing with clerks,” according to Reuters.
Economist Barry Ritholtz said, “The politics of this are quite fascinating: The bankers may own the corrupt US Congress, and they may have intimidated or bought off many of the more cowardly State Attorneys General, but there simply are too many counties and District Attorneys representing local interests throughout the country to all be bought off. Buying/intimidating/controlling all of the local country District Attorneys may be like herding cats — nearly impossible. I am going to stand by my original prediction: The early litigants may get something, but the latter lawsuits will likely result in bankrupting MERS.”
But what has happened? More and more judges are ruling that MERS’ role in the chain of title, more commonly ruling in MERS’ favor, dismissing cases left and right.